WTO says trade deal could boost global exports by $1 trillion

26th October 2015, 0 comments

Full implementation of the world trade accord reached two years ago could increase global merchandise exports by up to $1 trillion annually, according to a new World Trade Organisation report published Monday.

The World Trade Report offers the first estimates of the consequences of the December 2013 accord concluded at the WTO conference in Bali, noting in particular that emerging economies would capture more than half the gains.

The report "provides new evidence of the significant boost that the Trade Facilitation Agreement (TFA) will provide by expanding world trade, reducing costs and helping developed and least-developed countries to integrate into an increasingly globilised production system," said WTO director-general Roberto Azevedo.

"The world is more connected than ever before. More and more developing countries are seeking to join global trade networks," he added in a statement, stressing the need for quick implementation.

The WTO's landmark TFA deal on overhauling global customs procedures was the first multilateral agreement concluded by the organisation since it was founded in 1995.

The measures however will only take effect when ratified by the parliaments in two thirds of the 161 member-states. To date only 50 countries have done so.

It has been held up in part due to disagreements on the trade of agricultural goods and industrial goods, pitting bigger economies against smaller ones.

But without a deal, major barriers to trade remain.

"Outdated and uncoordinated customs processes slow down the movement of good and raise costs to prohibitive levels," Azevedo said.

The TFA would transform global trade, he added.

"It is global trade's equivalent to the shift from dial-up Internet access to broadband -- and it will have a similar impact."

That impact for developing countries could be an increase in exports of between $170 billion and $730 billion annually; for developed countries the estimate is an increase of between $310 billion and $580 billion.

A previous report on the impact of TFA was done by the economic research Peterson Institute in Washington.

It had also estimated that the fully implemented accord would boost global trade by as much as $1 trillion, and would recreate 21 million jobs, 18 million of which would be in developing countries.